Policies for clean energy

Act on Accelerating Grid Expansion

The energy transition will need an expanded, adapted grid to cope with more renewable power. Neither has been progressing fast enough, so the German Parliament has passed the Act on Accelerating Grid Expansion. But there is no agreement on how much needs to be done where. Official plans are in place, but several of the projects remain contested.

The Energiewende will require properly functioning infrastructure; in particular, the grid will have to be adapted and be made smarter. The current grid is designed to take power from central power stations to consumers, but the future will be more complex.

Large power plants will continue to export power to the transit grid, but it will need to be changed so that power from wind turbines (both onshore and offshore) in the north can reach consumer centers in the west and the south. These lines will also be used for power trading. At the low-voltage and medium-voltage levels of the grid, a growing number of small, distributed generators – solar arrays, cogeneration units, individual wind turbines, and small wind farms – will be connected, and special controls will ensure that everything runs smoothly. The grid will become more intelligent.

Up to now, grid expansion has not been progressing fast enough. Only a quarter of the 1,800 kilometers of new lines planned had been completed by mid-2015. Lines to connect offshore wind turbines are especially crucial. For some time, it was unclear who was financially liable if wind turbines had been installed offshore, but the grid connection was not ready. In the summer of 2012, the German government brokered a compromise between wind farm investors and grid operators by resolving that the former would be compensated by the latter – but the costs could be passed on to consumers. This compromise sets a double standard for wind power. Small onshore wind farms have to pay for their own connections up to the nearest transformer station, and they receive no compensation from grid operators if the capacity behind the transformer station needs to be upgraded and is not done in timely fashion. The onshore wind sector, which has traditionally been driven by community projects and small to midsize businesses, is therefore frustrated because grid operators – former subsidiaries of Germany's Big Four utilities, which have not always helped small onshore wind farms – are getting special treatment for their grid connections.

Grid reliability and growth in renewables go hand in hand
Source: CEER and own calculations

In 2011, the German Parliament passed the Act on Accelerating Grid Expansion (NABEG). It calls for a review of ultra-high voltage lines by Germany's Network Agency and for high-voltage (110-kilovolt) lines to be installed as underground cables as a rule. In addition, there is to be great public input and transparency at an early stage of planning to increase public acceptance. In 2014, two drafts of the Grid Development Plan analyzed the necessity of creating a “Federal Need Plan”, which would become law. The goal is not just grid expansion; existing grids will also be upgraded and optimized. For instance, special temperature-resistant power lines could be used to transport greater amounts of electricity without requiring further lines to be installed. Temperature monitoring would also allow power lines to be used closer to full capacity when the wind cools them off – which generally happens when there is also a lot of wind power. The NABEG was complemented by a special law to promote underground cables, particularly for long-distance high-voltage direct current lines.